A Comparative Analysis of Tariff Reduction Schedules Under the Australia-India Economic Cooperation and Trade Agreement (ECTA) and their Impact on Bilateral Trade Volumes

Abstract

               Tariff Reductions: The agreement allows Australian businesses to export over 85% of goods to India tariff-free, with the figure rising to 90% by January 2026. Conversely, 96% of imports from India are now tariff-free, with this number increasing to 100% by 2026.  This tariff liberalization is expected to benefit both nations by providing cheaper raw materials, enhancing global competitiveness, and reducing costs for consumers. The Australia-India Economic Cooperation and Trade Agreement ([ECTA) secures preferential market access for India to Australia's fast-growing market, which has over 1.4 billion people. For Australia, the agreement offers opportunities in India's labor-intensive sectors, including gems and jewelry, textiles, leather, furniture, food, and agriculture. Services: The agreement includes commitments in 135 sub-sectors in services, benefiting industries like business services, communication, construction, and engineering.  India's contribution includes market access to Australia in 103 sub-sectors and Most Favoured Nation (MFN) status in 31 sub-sector. Under the ECTA, the annex on professional services mentioned about encouraging MRAs in professional services. Recently, India and UK signed an agreement for mutual recognition of educational qualifications, as part of the UK-India Enhanced Trade Partnership (ETP). It will allow Indian students who graduate from British universities to apply for postgraduate qualifications, or embark on government careers that require university qualifications, when they return back to India.